₹75,000 Standard Deduction Calculator — New Regime

Not sure how the higher standard deduction changes what you owe this year? This calculator lets salaried taxpayers compare their tax bill under the old ₹50,000 standard deduction and the new ₹75,000 standard deduction for FY 2025-26, side by side.

It works out taxable income, tax liability, and your actual savings using the official income tax slabs set by the Government of India. If you'd rather see the bigger picture first, our old vs new tax regime calculator compares both regimes end to end; this page focuses specifically on what the deduction bump alone does to your number, and pairs well with the full salary tax calculator if you want your complete take-home worked out too.

Quick Tax Savings Examples

Here's what the jump from ₹50,000 to ₹75,000 actually looks like at different income levels.

What This Calculator Does and Doesn't Do

It does:

• Compare tax liability with the ₹75,000 deduction against the old ₹50,000 one
• Work out your exact tax savings based on your salary
• Break the calculation down slab by slab
• Apply the Section 87A rebate automatically
• Add the 4% Health and Education Cess
• Give you a result in seconds, no waiting around

It doesn't:

• Give you professional tax advice
• Factor in state-specific taxes or surcharges
• Account for special rebates that might apply to your situation
• Verify deductions you're claiming under the old regime
• Act as a substitute for the Income Tax Department
• Replace a conversation with a CA

Use it to understand what the deduction change means for you. For anything involving complex deductions or a high income, it's still worth running the numbers past a qualified Chartered Accountant.

Understanding Standard Deduction and Its Tax Impact

What Is Standard Deduction?

Standard deduction is a fixed amount salaried employees can subtract from their gross income before tax gets calculated on it. For FY 2025-26, it went up from ₹50,000 to ₹75,000, effective April 1, 2025.

It's built specifically for salaried employees and pensioners drawing regular income from an employer. The nice part: you don't need receipts or proof of anything. It applies automatically.

Who actually qualifies:

• Salaried employees earning a salary from an employer
• Pensioners receiving a government or employer pension
• Self-employed individuals, business owners, and freelancers don't qualify. If that's you, our professional income tax calculator is built for your situation instead

The ₹75,000 deduction applies to your whole salary (basic pay, allowances, bonus, commission, all of it) under the new tax regime. No forms, no documentation, nothing to submit.

How the Calculation Actually Works

The formula is straightforward:

Taxable Income = Gross Income − Standard Deduction − Other Deductions (if applicable)

Say your gross salary is ₹8,00,000 for FY 2025-26. Here's how it plays out:

1. Gross salary: ₹8,00,000
2. Less the new standard deduction: −₹75,000
3. Taxable income: ₹7,25,000
4. Apply the slab rates: 0% on the first ₹4,00,000, then 5% on the remaining ₹3,25,000 = ₹16,250
5. Add 4% cess: ₹16,250 × 4% = ₹650
6. Total tax: ₹16,900

That extra ₹25,000 in deduction shaves the same amount off your taxable income, which lowers what you owe. How much you personally save depends on where your income sits relative to the slabs, which is exactly what this tool works out for you.

Old (₹50,000) vs New (₹75,000): What Changed

FY 2024-25 and earlier: Every salaried employee got a flat ₹50,000 deduction, regardless of income level.

FY 2025-26 onwards: From April 1, 2025, the government raised it to ₹75,000. That's ₹25,000 more relief for every salaried taxpayer under the new regime.

The knock-on effect matters more than the number itself suggests. Stack this deduction with the Section 87A rebate, and salaried employees can earn up to roughly ₹12.75 lakh with zero tax under the new regime.

FY 2025-26 Income Tax Slabs (New Regime)

This calculator runs on the official FY 2025-26 slabs, notified by the CBDT. Here's how the tax gets built up:

A 4% Health and Education Cess gets added on top of whatever the slabs work out to. If you want the full notification behind these numbers rather than just the summary table, our write-up on the CBDT-notified slabs for FY 2025-26 walks through where each threshold comes from.

New Regime vs Old Regime: Which One Fits You?

New regime gives you the ₹75,000 standard deduction automatically, but no Section 80C or 80D claims. Tax rates are lower on the higher slabs, and the Section 87A rebate applies. It tends to work best if you're salaried, don't have major deductions to claim, earn somewhere between ₹5-15 lakh, and would rather not deal with paperwork.

Old regime keeps the ₹50,000 deduction but layers on Section 80C (up to ₹1,50,000), 80D, home loan interest, donations, and more, at the cost of higher tax rates (5-30%). If you're paying rent without HRA in your salary structure, it's also worth checking the Section 80GG rent deduction calculator before you decide, since that deduction only exists under the old regime.

The honest answer is: run your numbers through both and see. Most salaried employees come out ahead with the new regime once the ₹75,000 deduction is factored in, but if you've got a home loan and are maxing out 80C, the old regime can still win.

Section 87A Rebate: Full Relief for Middle-Income Earners

Section 87A wipes out tax liability entirely for salaried individuals below a certain income, and it's one of the more generous provisions in Indian tax law.

• New regime: total income up to ₹12,00,000 (per the Budget 2025 announcement)
• Old regime: taxable income up to roughly ₹5,00,000

If your income falls within that limit, your tax bill drops to zero, provided you file your ITR. For example, a salary of ₹10,50,000 minus the ₹75,000 deduction leaves ₹9,75,000 taxable income, which sits comfortably inside the ₹12 lakh threshold. Result: zero tax. If your income sits close to that ₹12 lakh line, the Section 87A marginal relief calculator is worth a look too, since the rebate can taper rather than vanish outright right at the edge.

Five Mistakes That Trip People Up

Mistake 1: Mixing up gross salary and taxable income. People assume 5% tax on a gross ₹6 lakh means ₹30,000 owed. That skips the ₹75,000 deduction entirely. The real math: ₹6,00,000 − ₹75,000 = ₹5,25,000 taxable, then 0% on ₹4 lakh plus 5% on ₹1,25,000 = ₹6,250 (before cess).

Mistake 2: Forgetting the 4% cess. It's easy to calculate tax off the slab rate and stop there. Don't. A ₹20,000 tax figure becomes ₹20,800 once the 4% cess is added.

Mistake 3: Missing the Section 87A rebate. Someone earning ₹10 lakh might work out their tax and forget that, under the new regime, anything up to ₹12 lakh income gets a full rebate down to zero.

Mistake 4: Leaving out other income sources. Only counting salary while ignoring interest, rent, or freelance income understates what you actually owe. Every taxable rupee needs to go in before the ₹75,000 deduction gets applied, not after. If rent or interest is part of your income, the rent income tax calculator and the interest income tax calculator handle those separately from your salary numbers.

Mistake 5: Trying to claim both regimes' benefits. You can't claim the ₹75,000 deduction and Section 80C together. It's one regime or the other: new regime gets you ₹75,000 and nothing else, old regime gets you ₹50,000 plus whatever eligible deductions you can show.

Real-Life Examples

Neha, Software Engineer, ₹8,50,000 salary, new regime, no other income:

With the old ₹50,000 deduction: taxable income ₹8,00,000, tax ₹20,000, cess ₹800, total ₹20,800.

With the new ₹75,000 deduction: taxable income ₹7,75,000, tax ₹18,750, cess ₹750, total ₹19,500.

Savings: ₹1,300 a year, roughly ₹108 a month.

Rajesh, Operations Manager, ₹5,50,000 salary:

Old deduction: taxable ₹5,00,000, tax ₹5,000, cess ₹200, total ₹5,200.

New deduction: taxable ₹4,75,000, tax ₹3,750, cess ₹150, total ₹3,900.

Savings: ₹1,300 a year.

Priya, Senior Manager, ₹25,00,000 salary:

Old deduction: total tax ₹5,81,880.

New deduction: total tax ₹5,76,680.

Savings: ₹5,200 a year. Still real money, but the percentage saved shrinks the higher up the slabs you go, since the ₹25,000 extra deduction is a smaller share of a bigger income.

Privacy and Data Protection

Everything runs in your browser. Your income details never leave your device.

• Client-side processing: all calculations happen locally, in your browser
• No data storage: we don't save or collect any income information
• No logging: your calculation history isn't tracked anywhere
• No tracking: no analytics run against your personal income data
• No login required: use it anonymously, no account needed
• HTTPS secure: the site is encrypted

Since nothing gets sent to a server, there's no third party involved and no data collection to worry about. What you enter stays on your machine.

Important Disclaimer

This calculator exists to help you understand your numbers, not to file on your behalf. It's built on the official FY 2025-26 slabs and standard deduction rules, but it can't see your full financial picture, so treat the output as a working estimate rather than a final figure.

A few things it can't account for: state-level surcharge, age or status-based rebates, whether your old-regime deductions would actually hold up on verification, or anything specific to your personal circumstances. If you're deciding how to file, or your income involves anything beyond a straightforward salary, get a qualified Chartered Accountant to look at the actual return before you submit it. They can catch things a calculator can't and keep you compliant with the current rules.

We've built this tool carefully, but we can't take responsibility for decisions made purely on its output. Cross-check anything that affects your filing with the Income Tax Department's own notifications or a licensed advisor.

This is an estimate. Always check with a qualified Chartered Accountant before making tax decisions, planning investments, or filing your return. Your situation might have wrinkles this tool can't see.

Frequently Asked Questions

What's the difference between ₹50,000 and ₹75,000 standard deduction? The government raised the standard deduction from ₹50,000 to ₹75,000 starting FY 2025-26 (April 1, 2025). That extra ₹25,000 lowers your taxable income and, with it, your tax bill. How much you save depends on your income and which slab you land in.

Who can claim the standard deduction? Only salaried employees (income from salary under Section 15 of the Income Tax Act) and pensioners. Self-employed professionals, business owners, and anyone earning through other income sources can't claim it.

Can I claim both standard deduction and Section 80C? Not under the new regime, no. You get the standard deduction and nothing else there. Under the old regime, you can combine the ₹50,000 deduction with 80C, 80D, home loan interest, and similar claims. Run both through the calculator's comparison mode to see which comes out ahead.

Does the ₹75,000 deduction apply to everyone? Yes, to every salaried employee in FY 2025-26, regardless of income or age, but only under the new tax regime. Old regime taxpayers still get ₹50,000.

What if my income is lower than the standard deduction? Your taxable income drops to zero once the deduction is applied, and you won't owe any tax. The calculator handles this automatically.

Does this factor in the Section 87A rebate? Yes, automatically. Under the new regime, it gives full relief for residents whose taxable income doesn't cross ₹12,00,000 (per the Budget 2025 update), which can bring tax down to zero for a lot of middle-income earners.

From when does the ₹75,000 deduction apply? FY 2025-26 onwards (assessment year 2026-27). If you're filing for FY 2024-25, you're still working with ₹50,000. Anything from April 1, 2025 onward uses ₹75,000.

If my deductions exceed ₹75,000, should I switch to the old regime? Not automatically. Even with high deductions, the new regime's lower rates can still work out better at certain income levels, so it's worth checking both before deciding.

Does the deduction apply to bonus and allowances? Yes. The ₹75,000 deduction applies to your total salary income, basic, allowances, bonus, commission, all combined, not to individual components. HRA and other allowances count toward the gross figure.